Three cheers for ‘woke capitalism’?: A discussion

Introduction

After decades of debates on shareholder and stakeholder capitalism, democratic and state capitalism, post-industrial and knowledge capitalism, there is a new show in town: woke capitalism. Coined in 2018, the concept refers to a conscious strategy employed by companies to align their brand image, hiring policies and corporate strategies with progressive causes (Douthat, 2018). Woke companies are said to support recycling and sustainability, anti-slavery initiatives and Black Lives Matter, the LGBTQ+ community, racial diversity and equal opportunities for immigrants. Some have hailed the new wokeness of Wall Street, Silicon Valley, and Madison Avenue as the only way forward (Hutton, 2022), others are much more worried about the underlying rationale of companies to ‘go woke’. This debate has led to a flurry of popular books denouncing global, cynical C-suite capitalists, who misuse the concept of diversity as a promotion tool and who fake corporate morality in order to maintain their position in a highly exploitative economic system. Interestingly, these complaints can be heard – of course in somewhat different forms – both on left-wing radio stations as well as on prime-time Fox News. During the 2022 Copenhagen Pride Week, we invited Professor Carl Rhodes and Danish journalist Mathias Sindberg to discuss whether woke capitalism actually exists, and what civil society activists can do to protect their movements from openly exploitative co-optation of their causes by corporate PR strategies.

Professor Carl Rhodes is Dean of UTS Business School and author of the book Woke Capitalism (2021), which offers a seminal critique of programmes to reengineer democracy for corporate purposes. The book was widely reviewed, for example in the LSE Review of Books, Marx & Philosophy, Organization Studies, and in Organization (Corvellec, 2022; Klikauer, 2022; McCracken, 2022; Pek, 2022). Mathias Sindberg has written a series of articles on woke capitalism in the Danish newspaper Information (Sindberg, 2021a; 2021b; 2021c; 2021d). These articles proved to be enough of a sting to provoke the CEO of the global shipping giant A. P. Møller Maersk and the communications officer of Philip Morris to write rejoinders. The panel debate was arranged as a dissemination activity of the research project ‘Beyond Pinkwash: Pride Parades and Integrative Civil Religion’, financed through Independent Research Fund Denmark (DFF), and led by Associate Professor Stefan Schwarzkopf from Copenhagen Business School.

In this edited version of the conversation, Carl Rhodes serves as the ‘prosecutor’, whereas Stefan Schwarzkopf plays the devil’s advocate in ‘defence’ of woke capitalism. Meanwhile, Mathias Sindberg is cast as both jury and judge, weighing the arguments, albeit without ever reaching a clear conviction. As such, this discussion points to major fault lines of the phenomenon conceptualised as ‘woke capitalism’. Beyond the question of whether we have to reject or embrace it, our exchange also centres on the question whether this phenomenon actually exists.

Carl Rhodes: The reason for me being invited to this panel today, I presume at least, is that last year I published a book which was entitled Woke Capitalism: How Corporate Morality is Sabotaging Democracy. Now, at the time the book was published, I had the opportunity to write an opinion piece for The Australian, the weekend version of it. It is the only national newspaper in Australia. A great opportunity. My article summarised the main themes of the book. I wrote that today it seems like we’re in a world turned upside down, when you see investment giant J.P. Morgan committing billions of dollars to solve the problem of racial economic inequality. You’ve got Amazon tycoon Jeff Bezos pledging further billions to save the planet from climate change. You’ve got CEOs of the world’s biggest companies banding together under their club, the Business Roundtable in the US, showing their commitment to stop putting profits ahead of community stakeholders. All those things are what have become called, ‘woke capitalism’. Across the world, mega-corporations publicly supporting positions that traditionally we would have associated with progressive or left politics. So, we now have businesses as diverse as Gillette, Burger King, Adidas, Microsoft, being very public and supporting issues related, for example, to LGBTQI+ rights, Black Lives Matter, the #MeToo movement, climate activism. These are all mainstays of the corporate agenda today.

If you go over onto the right wing of politics, especially the crazier end of the right wing, there’s a veritable outrage that corporations have strayed from their mission of shareholder driven profit seeking. They are accused of decoupling themselves from social conservatism. Shouty conservatives and easy to outrage rightists, they’re having conniptions, where you can read headlines about how the far left has infiltrated business, how corporations are kowtowing to radical socialists, and how we’re being conned by a progressive social justice scam. Those folks are certainly not giving three cheers to woke capitalism. While it is important to take this politics seriously, the argument that they make is very difficult to take seriously. These people would have you believe that we are witnessing a reinvigorated communist plot where somehow revolutionary interests have infiltrated capitalism in a Trojan horse full of red tied bankers and pinstripe financiers.

I generally agree with the progressive political positions frequently dismissed as woke by people on the right. But I still have a problem with woke capitalism. It is just that my problem is more with what it means in terms of capitalism than what it means in terms of woke. The real danger of the trajectory that woke capitalism is putting us on, I argue, is that it breaks the fundamental democratic distinction between the private and the public spheres. Once upon a time, democracy may have required the separation of church and state to permit religious freedom. Today, I would say, the preservation of democracy comes down to the separation of state and corporation to permit political freedom. For me, the problem is that under woke capitalism, power shifts from the democratic institutions beholden to the public interest, to commercial institutions, beholden to private interests. It is all well and good if the corporations want to contribute to social or environmental progress, but not if that comes at the expense of democracy. Woke capitalism is not about corporations behaving like do-gooding, tree hugging snowflake lefties. At best, they are responding to public sentiment coming from their employees or customers by doing a few benign things to help others. At worst, they’re playing hardball by working to seize political power from the institutions of democracy. In that case, wherever you might be on the political spectrum, what is really at stake with woke capitalism is losing a shared commitment to a political system based on justice, equality, community, and freedom.

The gay activist movement in the sixties and seventies, as is well known, involved radical politics. There were significant personal risks, risks of violence to oneself or even death, arrest, public shaming, or the more general public cases that you saw of gay bashing. In response to my article in The Australian, I received an email from Dennis Altman, an original activist making real change in the world over a significant amount of time. I’m going to quote from it, and I have Dennis’s permission to do so. He said, ‘I liked your short piece in The Weekend Australian. During the marriage debate I got into trouble for pointing out that while QANTAS pushed hard for same sex marriage, they had no problems cosying up to Emirates, despite the draconian anti-homosexual laws of the UAE.’ When I read Dennis's comment, what I saw was the difference between woke capitalism and real political activism. He is referring here to the postal ballot vote that happened in Australia in 2017 about whether same sex marriage should be legalised or not. The company QANTAS became very outspoken in support of that, particularly through their CEO Alan Joyce, himself an openly gay man. But what I saw in Dennis’s comment is that while companies like QANTAS might jump on the LGBTQI bandwagon, they do so with little or no risk. In fact, they are often cashing in on hard-won battles that have been fought by activists such as Dennis. Again, people risking physical harm or death to demand equal rights. Woke capitalists only do this in markets where public opinion is on the side of the political position they are leveraging, was Dennis’s point.

One question we might ask is whether CEOs and other people in organisations are somehow inauthentic, that is they do not mean what they say and are cynically woke washing their own corporations. I do not really see much evidence of that. Again, if we think of Alan Joyce as being an active supporter, it seemed entirely reasonable and authentic. But what he was also authentic about was a very explicit argument, to use his words, the economic argument for marriage equality, that if QANTAS supported marriage equality, it would be good for their business. That was always part of his shtick. It was a combination of a case of human rights, but also of a business case with the two being very much entwined. Was Joyce cynical? No, it doesn’t seem that he was, but he had no qualms in mixing his business interests with his political convictions. And this all amounts to what, some time ago, David Vogel called The Market for Virtue (2005). So, while activists like Dennis Altman were the leaders who did take the risks and did make the real changes, the woke CEOs are followers who make very measured business decisions about the politics they enter into.

When it comes to CEOs, the potential for politics is always limited by business matters. Liberty and equality and public and political ideas for them are pursued in a way that is subject to private commercial interests. This is an abasement of democracy. Individual corporations and CEOs have power that arises not from popular sovereignty, not from the general will, but from wealth. It’s convenient to support them when they do something that we agree with politically. But that same power can be wielded for other purposes, for reasons we don’t agree with politically or that are publicly irresponsible. If we latch onto woke capitalism, we always risk that the political power will wind up in the hands of people who have no public accountability. Three cheers for the political activists and for the democratic process. Maybe just one cheer for the woke capitalists who follow them for their own benefit.

Stefan Schwarzkopf: As I take on the role of devil’s advocate, I would like to engage a little more closely with four specific arguments that Carl Rhodes is making, arguments that can also be found in the recent literature on this subject (Leong, 2021; McWorther, 2021; Ramaswamy, 2021; Rhodes, 2021; Táíwò, 2022). First of all, I am wondering, is there evidence in this literature that we are really talking about woke CEOs who are disingenuous, who do not really mean it. Are we really talking about striped suits who simply bring out cash-filled corporate PR campaigns to jump on the bandwagon. What struck me when I went through the literature is how little evidence is actually presented for the idea that ‘wokeism’ is only public relations and does not mean anything to the organization. When people go inside organizations to find out how LGBTQ+ issues are being handled, they often come back with empirical evidence which shows that it is in many cases mid-level employees, mid-level managers who start bottom-up campaigns, which then top management agrees to running because they cannot say ‘No’. Since the field of public discourse in the last 10 years or so has changed so much, it has become possible from an employee perspective to put pressure from the bottom up. Public culture has changed so much. Yet, when you look for evidence, unfortunately, the academic literature provides little insight into what is really going on in companies that change towards a ‘woke strategy’, if you will. 

There is on the other hand a lot of anecdotal evidence, and I want to throw in one anecdote here, just for us to consider. This was relayed to me by an LGBTQ+ organiser from Latvia who attended Copenhagen 2021 WorldPride, and who was himself a major organiser of the 2015 EuroPride in Riga. He told me that in previous years, ever since he has been involved in this, it tended to be the case that companies engaged with the Pride agenda in such a way that they had often prefixed, pre-decided marketing campaigns onto which they then stamped the rainbow flag. But since 2020, he noticed in his own environment, in his own country, a remarkable change. Now, he said, companies were coming to him for advice. There was one specific major sponsor that he talked about, a cosmetics company, which told him that it was pointless to just produce another rainbow-themed lipstick. They had changed and began to talk to him about what they as a company could do for that movement in Latvia, in Riga specifically. So, if one talks to activists, if one talks to people, there often emerges, at least anecdotally, a different picture. Not the picture of top-down PR campaigns that are simply rolled out. Something else can happen as well.

Let us now turn to the problem of the political risk that companies are taking. Carl Rhodes makes the argument at the end very powerfully: it is nice if companies like QANTAS campaign for an equal marriage act in Australia, but whatever they do, it is risk free for them. He often draws a clear distinction between what he calls real political activism and something that is risk free. I would like us to consider in a little more detail whether such a strong distinction actually exists. In 2021, the Boston Consulting Group, which is a global consulting organization, issued a report about the crucial first 100 days; what it means for an organization to make the transformation towards LGBTQ+ rights. When that report was published and publicly debated at the 1:1 Democracy Festival, which was held during Copenhagen 2021 WorldPride, I talked to one of the office managers who had co-authored the report. I put the question directly to him and asked what it really meant for the Boston Consulting Group to issue such a report. In other words: do you really mean it? What changes really for your work life? He relayed to me a story about his time as an office manager in the Middle East. During that time, on at least two occasions he was talking to prospective clients who would start meetings in a very jovial way with sexist jokes. He then pointed out that these were offices, Boston Consulting Group offices, and that these jokes would not be tolerated. In one case, a prospective client did not return and so was lost to the company. In the other case, the person apologised and they worked on a continuing relationship. This is an anecdote only – no more and no less. But the Boston Consulting Group is not a small company. If you know about the environment of global consulting, you will know that BCG is a ‘heavy hitter’. In this case, a member of staff did take the risk in the Middle East to declare, in his language, BCG offices as a cultural embassy. This means that when you enter these offices, you enter a different cultural realm, so to speak, where a different culture is imposed even on local clients who might take offense. This, I think, is hardly always risk free.

The idea of woke capitalism being risk free, driven by CEO’s who only ant to cash in, worries me for another reason. Behind it is implicitly a particular theory of democracy. Carl Rhodes mentions this at a point, namely that democracy is when people vote, and there is ‘real political activism’, whereas companies are only private. In my mind, the fact that companies are privately owned through shareholders, etc., does not mean that they are not public actors. They are always public actors, especially large companies. We are living in an era defined by the #MeToo movement, the Black Lives Matter movement, and so forth, and we desire a pluralist democracy. Imagine a pluralist democracy where large corporations that we consume from and work with and engage with have nothing to say on racism and harassment. This would not really work, would it? Companies are not private, as in my family being private. They are always already public, and in a pluralist democracy every institution is a public actor. If they would not engage in these debates, then we would probably be very disappointed that companies had nothing to say about racism, rising levels of misogyny, environmental degradation, climate change, and peak oil. But if they do so, we say that they are ‘woke’. This debate has thus elements of a blame game that I think only creates losers.

Earlier this year, there emerged an interesting case in Florida that involves the Walt Disney Company, a brand that I personally have always associated with the social conservatism of white, middle class, suburban families and American values. In spring 2022, Disney began to take on the Trumpist Republican Governor of Florida, Ronald deSantis, and rejected the so-called ‘Don’t Say Gay’ bill that deSantis had introduced. Disney stopped making political donations in Florida, too. In retaliation, deSantis rescinded a regulation that allowed Disney to exert private government over the areas where Disney World Orlando is located, potentially having huge tax implications for the company. Amidst this controversy, Disney welcomed the Orlando Pride parade on its grounds and gave Mikey Mouse rainbow-coloured ears (Rice, 2022). As superficial as this may sound, being woke is not risk free for companies. It is not risk free to take on the Governor of Florida, a man who sends busloads of immigrants to New York to score a political point. It is not risk free for Mærsk to ship a rainbow-coloured container through the ports of Saudi Arabia, a country that recently has begun to remove rainbow-themed clothing and toys from the shelves of its shopping malls (Gritten, 2022).

Finally, I would like to turn to a point that Carl briefly mentioned, something that I think is overlooked in its importance. I am more and more intrigued by the fact that some left-wing criticism of woke capitalism can be heard word for word, almost copied, each night on Tucker Carlson and similar right-wing ‘news’ shows on Fox News. You can read it in the Daily Mail and other right-wing newspapers. It is of course crazy to believe that corporate capitalism is somehow taken over by left-wing cultural Marxism. Yet, listen to these debates carefully and you will hear a familiar argument about popular sovereignty, an argument for democracy to be defined by public debate and not private (commercial) interest. Although I am not entirely certain about the meaning of this development, it seems clear to me that the debate around ‘woke capitalism’ is a sign of the end of the Left’s decade-old monopoly on the critique of capitalism. While in the past, one could be certain that the Right would be anti-woke but always pro-business and pro-capitalism, this certainty is now gone. There is a discourse change that took place around 2016 or so. Not just in the US, but also more and more in Europe, the anti-capitalist, not just the anti-woke, the anti-capitalist argument is increasingly taken over by the Right. In other words, the monopoly on critique has been broken. Being anti-capitalist is now possible very much on Fox News. There are now far more parallels between the left-wing critique of woke capitalism and talk-points on the Right. This is the point that concerns me most, because I am not sure where this journey of conversion will ultimately lead us. 

Mathias Sindberg: The question of ‘woke capitalism’ has of course been conceptualized in terms of whether one is for or against it. I suppose that everybody here knows that whenever the word ‘woke’ is used, it is usually in a sceptical way. It is the same when the Left uses the word neoliberalism. It is always people who are very critical of neoliberalism who call it that way. That is the case with ‘woke’: whenever that word is invoked, you know that it is by somebody who is sceptical of it. And I have to say that if you start at the very basics, fundamentally, I think we have to see ‘woke capitalism’ as a good thing. Regardless of the intent of the corporation, regardless of whether it matters that Lagkagehuset [a chain of Danish bakeries] does not pay taxes in Denmark and yet has a shop here at Pride Square in front of Copenhagen City Hall, ‘woke capitalism’ is a sign of moral progress to an extent. As Stefan Schwarzkopf said, public culture has changed so much that every large brand wants to be associated with the LGBT+ fight for rights. That is hard to see as anything other than a triumph of the Left that large corporations – big capitalism – is mimicking progressive language. What was just a few decades ago considered radical demands by the ‘hard Left’ are now at the very centre of the mainstream. I find it hard not to see this as a victory of progressivism.

My main problem with woke capitalism is that it is always associated with an element of hypocrisy. There are the very blatant examples of companies that are plainly just bullshitting, like Philip Morris, the tobacco giant, for example, which insists that they are invested in the progress of public health and trying to get people to stop smoking. These are obvious examples of hypocrisy. Big oil companies Exxon Mobil and Chevron insist they are part of and engaged in the green future, and so on. But I think there’s a broader element of hypocrisy, and I think what is present in most cases of what can be called ‘woke capitalism’, is that it is placing itself on the progressive side of arguments over justice. This includes justice for racial minorities, for gender minorities, and women’s rights. But the question of economic justice is always demonstratively absent. Take the case of Nike, for instance, a company that for the past five years has been at the forefront of the Black Lives Matter movement. They have commercials with the quarterback Colin Kaepernick, who took the knee during the American national anthem. Their TV commercials are always revolving around the case of social justice, of racial justice. But at the same time, they have not paid any federal corporate income tax in the US since 2018. They are deliberately not supporting the American welfare state that is supposed to be supporting black people. While they are preaching racial justice in America, their shoes are being sown by brown people in Bangladesh, working in sweatshops. And there is always this element of hypocrisy that, I think, is the fundamental issue with what we call ‘woke capitalism’.

Carl’s fear of ‘woke capitalism’ stems from the breaking of the distinction between private and public spheres, and the slow removal of political power away from democratic institutions. I think the premise of that argument is based on an illusion. It suggests that there was once a time, a situation before ‘woke capitalism’, when companies were not political and had no values. I do not think that there was ever an absence of ideology in major corporations. Political values were just broadly aligned with social conservatism or with the idea of self-interest, which is also an ideal, also a case of ideology.

What I am worried most about is ‘woke capitalism’ blurs out conflicts of interest. It creates the illusion that we all have aligned interests, that Maersk and the Filipino people working on the Maersk ships all have the same interests, that we are all pursuing the same goals of equality and tolerance and transparency. But even though the wave of moral awakening among corporations is fundamentally a good thing, it does not change the fact that there are conflicts of interest, that the workers and the owners of the company do not share the same interest. Somebody wants to get paid more and somebody else wants to raise profit. That is the fundamental aspect of capitalism that is at risk of being blurred out by the virtue signalling of major corporations.

Conclusion

While Mathias Sindberg, despite being cast in the role as judge and jury, does not come to a final verdict we may conclude from the different positions that a differentiated assessment is needed if wanting to acknowledge progress and, at the same time, retain a degree of healthy scepticism of the conflictual nature of progress. Or to paraphrase Mathias Sindberg: woke capitalism is a sign of moral progress that, however, is always also associated with an element of hypocrisy. If reading Stefan Schwarzkopf’s remarks not as a counter position to that of Carl Rhodes but instead—and in his own words, as a call ‘to listen carefully to these debates’, woke capitalism does hold a potential beyond that of becoming placeholder for an ideological fighting term akin to neoliberalism, which is useful to secure and delimit positions, but not to deepen our understanding of real developments. The positionalities represented by Stefan Schwarzkopf highlight how corporate engagement with progressive politics is far from being risk-free, nor is it automatically inauthentic – even when bearing in mind its instrumentalization tendencies. Since it cannot be decided in advance whether a CEO activist is sincere or not, singular cases must be considered. And thus, most of all, we believe this discussion shows that one cannot be ‘for’ or ‘against’ woke capitalism in principle.

acknowledgements

We would like to thank the reviewers and editorial collective for providing useful comments that were instrumental in developing and writing this Roundtable from its original format of a live panel debate during Copenhagen Pride whom we thank for hosting us as part of their human rights programme in 2022.